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Market Overview

Things Are about to Get Exciting

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Less than a week after announcing that we’re moving to the blockchain, we have another exciting product update for you today.

Pages for $DASH, $LTC, $ETC, and $XRP are now taggable on the eToro social investment network!!

The number one request from our clients has been to open up access to more cryptomarkets, so here it is. Please note, that these instruments will not immediately be available for individual trading. As many of these markets have very low liquidity it will take a while before we are able to act as your market maker and guarantee instant transactions.

However, as the main purpose is for investing, the first use will be as part of a Copyfund that will allow you to gain exposure to a wide array of crypto assets.

The aptly named CryptoFund is also up on the platform and should be available for investment shortly. Just to be able to tag these new markets on my wall was a big pleasure for me.

Mati Greenspan
eToro, Senior Market Analyst

 

Please note: All data, figures, and graphs are valid as of June 7th. All trading carries risk. Only risk capital you can afford to lose.

Market Overview

Today’s gonna be a strange day in the market mainly because of so much anticipation for tomorrow. In addition to the UK Elections, we’ll have a critical speech from the European Central Bank’s Mario Draghi, and a rare testimony from the former FBI director James Comey, you know the guy who Trump fired for being unfair to Hilary Clinton.

Comey is set to spill the beans about his conversations with the President in front of Congress and the world tomorrow afternoon. Depending on what he says, the markets could get volatile. President Trump will not be attending the event but rumor has it he will be live tweeting his thoughts.

The issue for investors is whether this whole Trump-Russia scandal will impair Donald’s ability to bring them infrastructure spending, as well as healthcare and tax reform. So the dicier things get the bigger impact we can expect.

The US Dollar is already feeling the Trump squeeze and falling steadily since the beginning of the year.

The stock markets, on the other hand, were performing swimmingly this year as the only thing they seem to care about is future profitability if and when Trump delivers on his promises. To be fair, small business are feeling incredibly confident at the moment.

Volatility on the stock markets has been muted since the French Elections (red circle), with the exception of May 17th when markets briefly sold off on Trump related worries.

This chart shows the VIX volatility index for the past three months. For reference, a reading below 11 points represents historically low market movement.

Reading the markets we can see a clear flight to safe haven assets.

Gold is at it’s highest levels since the night of Trump’s election (white circle). Currently, it is running into heavy resistance at $1300. If it pushes through that…

The other major flag of safe haven attitude is the action on USDJPY, which has been pushing lower since mid-May and spiked below 109.25 this morning.

Another reason for fear is the declining price of oil. It’s not an issue yet but if the price remains below $50 for an extended period or if it gets much lower, it could be seen as a weakness in the global economy.

The crude oil inventories are coming out this afternoon so be sure to watch closely.

FCC on BTC

Over the past 24 hours we’ve seen new all time highs on Bitcoin and Ethereum. The daily charts for both are looking quite impressive at this point.

The prices certainly could truck further but any retracement could also be very dangerous at this point as this is an extremely risky market.

The Japanese exchange Bitflyer has upped their volume significantly yesterday and at one point had logged 132,000 BTC traded in a 24 hour window.

The revolution is happening there and several supermarkets in the country are already accepting Bitcoin as payment for groceries. Exciting times indeed!

Tomorrow, in addition to all the action in the traditional markets crypto-markets could be moved by a hearing from the FCC in the United States. They have several blockchain experts who will lecture the US government on Financial Innovation and National Security Implications of Virtual Currencies.

Let’s hope we see more integration in more places. 🙂

Have an amazing day ahead!

This content is for information and educational purposes only and should not be considered investment advice or an investment recommendation.
Past performance is not an indication of future results. All trading carries risk. Only risk capital you’re prepared to lose.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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Analysis

3 Things You Need to Know About the Market Today: Trade Rally, Pound Pullback, Tesla Worries

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1, Trade Optimism Drives Rally in Stocks, Oil

Shanghai Composite, 4-Hour Chart Analysis

The US government is mulling to lift or ease some of the trade tariffs on Chinese goods, at least according to the reports that surfaced yesterday, and although the rumors were promptly denied by the Treasury, risk assets have been pushing higher ever since. Global stocks are trading at 1-month highs, with understandably, the major US indices and China leading the way higher. We expect further gestures by the two sides in the coming weeks, as the talks progress, but a final agreement could still be months away.

The most affected commodities, such as copper and oil are also up today, and but as we noted this weekend, the oversold rally in risk assets is stretched now. Also, even as the weaker global benchmarks, such as the Shanghai Composite have joined the party, the clear economic slowdown and the bearish technicals make the current environment hostile for bulls

2, Pound Retreats After Hitting 2-Month High Above 1.30

GBP/USD, 4-Hour Chart Analysis

Besides the Trade War saga, the likely delay of the Brexit deadline has been making waves all week long, and Pound bulls seem to like the idea of a possible “soft” deal with the European Union. The currency hit its highest level against the Dollar since mid-November, topping the 1.30 level, while British stocks are also trading near their 2019 highs.

Prime Minister Theresa May pledged to include the opposition parties following Wednesday’s no-confidence vote, but for now, even starting the talks is challenging, even though the government labeled the first talks “constructive”. In any case, with the chances of a no-deal Brexit being low right now, the Pound could enjoy further gains, especially as long as the global risk rally lasts.

3, Tesla Disappoints With Guidance, Cuts Workforce by 7%

Tesla (TSLA), 4-Hour Chart Analysis

While it held up very well during the recent tumroil in the stock market, Elon Musk’s crown jewel, Tesla (TSLA) has been down by as much as 8% today in pre-market trading after warning investors that the electric car maker will likely turn a smaller-than-expected profit in the coming quarter. Tesla is struggling to ramp up the production of the Model 3, while also facing difficulties to hit its cost goal with regards to its “mass” product.

With the traditional car makers slowly but surely closing in on the company, and given the looming cash flow issues, the coming quarters will crucial for the Musk. The company just avoided bankruptcy in its early days, and some bears think that the fierce competition and the production issues could lead to a crisis yet again. The company’s workforce skyrocketed in recent years, and today CEO Musk also announced that it will lay off 7%, approximately 3000 workers, to cut costs after the expansion. He stated that,

“We unfortunately have no choice but to reduce full-time employee headcount by approximately 7%, we grew by 30% last year, which is more than we can support, and retain only the most critical temps and contractors (…)”

While today, earnings reports will be few and far between, Netflix (NFLX) will also be in focus after reporting yesterday in after-hours trading, and for now, the streaming giant is also trading lower despite the broad overnight rally in stocks.

Featured image from Shutterstock

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.7 stars on average, based on 443 rated postsTrader and financial analyst, with 10 years of experience in the field. An expert in technical analysis and risk management, but also an avid practitioner of value investment and passive strategies, with a passion towards anything that is connected to the market.




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Market Overview

Make it or Break it

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Hi Everyone,

In the United States at the moment, there are nearly 39 million people on food stamps. We already know that government workers are not getting paid during the shutdown but what now seems unclear is how the shutdown affects the poor.

For those of you who are not familiar with food stamps, this is the US government’s welfare program that provides food to poor people by giving them coupons that they can take to the store.

The thing is, the system is quite complex and varies for different states and different retailers. A few stores have already been forced to stop accepting food stamps due to the shutdown and some states have given their citizens an advanced payment.

For now, it seems that only a small number of people have actually been affected but with some analysts predicting that the shutdown could last for several more months, the future seems incredibly uncertain and information is hard to come by. So it’s worth keeping an eye on this development as it could potentially affect several areas of the US economy and the broader market.

@MatiGreenspan
eToro, Senior Market Analyst

Today’s Highlights

  • Shutdown: Day 28 | Days to Brexit: 70
  • 10 Year Challenge
  • Russia’s Real Crypto Plans

Please note: All data, figures & graphs are valid as of January 18th. All trading carries risk. Only risk capital you can afford to lose.

Traditional Markets

The markets were relieved yesterday by the news that…

This is a good indication that US-China trade talks are going well and seeing any sort of concessions from the White House, or even the indication that there may be concessions, is cause for celebration among investors.

The positive sentiment has carried through the Asian session and well into European trading.

Risk On

With the rise in stocks, we’re seeing some of the hallmarks that show investors are looking to take on more risk today.

Gold has managed to pull back from the $1,300 resistance level and oil is testing new highs, despite an IEA report that expects over-production to continue.

Perhaps the biggest indication of risk on sentiment today is coming from the USDJPY, which has now stepped over the 109 level as traders sell the Yen for the Greenback.

Next weekend is likely to start with a bang!

Just a few hours after markets open and before most western investors have opened their eyes, China will report some critical GDP growth data. As the China slowdown has become a prevalent theme in the markets recently this single data point can be a make it or break it moment.

Russia’s Real Crypto Plans

Last week, in one of our daily market updates (titled: Digital Reserves), we discussed a rumor that was circulating in the crypto community that the Central Bank of Russia may be planning to add bitcoin to its national reserves.

Well, it turns out Elina Sidorenko, the chairperson for the government committee for overseeing cryptocurrencies, has now clarified that while Russia might want to do this, it could be another 30 years before this becomes a reality.

As we correctly noted in the daily update at the time, the major setback here is that there is currently no legal framework for doing this. However, from what I understand, the idea of setting up a national CryptoRuble is being discussed among government officials and could very well happen within the next couple of years.

In any case, we do know that the government of Russia is watching the crypto space quite closely. Dimitry Medvedev was quoted just yesterday as saying that the bear market doesn’t spell the end of crypto.

Spoken like a true crypto advocate!!

Have an amazing weekend.

This content is provided for information and educational purposes only and should not be considered to be investment advice or recommendation.

Past performance is not an indication of future results. All trading involves risk; only risk capital you are prepared to lose.

The outlook presented is a personal opinion of the analyst and does not represent an official position of eToro.

eToro is a multi-asset platform which offers both investing in stocks and cryptocurrencies, as well as trading CFD assets.

Please note that CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 65% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.

Cryptocurrencies can widely fluctuate in prices and are not appropriate for all investors. Trading cryptocurrencies is not supervised by any EU regulatory framework.

Best regards,
Mati Greenspan
Senior Market Analyst

Connect with me on….

eToro: @MatiGreenspan | Twitter: @MatiGreenspan | LinkedIn: MatiGreenspan |Facebook:MatiGreen

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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Market Overview

U.S. Stocks Surge as Trump Administration Weighs Ending Trade War With China

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U.S. stocks turned higher Thursday afternoon amid reports that Washington was considering lifting tariffs on Chinese goods to expedite a trade deal with Beijing. Cryptocurrencies headed for another mediocre session overall, though altcoins showed modest upside toward the end of the session.

Stocks Extend Recovery

All three of Wall Street’s major indexes finished in positive territory, extending their winning streak to three days. The Dow Jones Industrial Average gained 163.08 points, or 0.7%, to 24,370.24, its highest settlement since Dec. 13.

The broad S&P 500 Index climbed 0.8% to finish at 2,635.96. All 11 primary sectors finished with positive results, with materials and industrials leading the way higher.

A strong performance in technology shares lifted the Nasdaq Composite Index to gains of 0.7%, where it finished at 7,084.46.

The indexes have gained more than 11% since Christmas Eve, when they traded at more than one-year lows. The S&P 500 and Nasdaq briefly entered bear-market territory in one of the worst quarters since the financial crisis.

End of the Tariff War?

The United States is strongly considering easing tariffs on China in an effort to broker a new trade deal before the self-imposed Mar. 1 deadline. According to The Wall Street Journal, U.S. officials would like to give Beijing bigger incentive to make bigger concessions in the next round of negotiations.

Both sides held face-to-face meetings last week, with China agreeing to open up its domestic market to U.S. companies and purchase more American-made farm and energy commodities. Further talks are planned in the coming weeks.

The Mar. 1 deadline reflects the 90-day truce period agreed to by President Trump and China’s Xi Jinping in December. After meeting on the sidelines of the G20 summit in Buenos Aires, both leaders committed to ending the trade war and returning to the negotiating table.

Cryptos See Modest Upside

The cryptocurrency market saw the narrowest of gains Thursday thanks to a late rally by altcoins and tokens. Bitcoin cash rose 1.3% to $130.63, EOS added 3% to $2.51 and Tron gained 4% to $0.0258. Outside the top ten, IOTA, Binance Coin and Ethereum Classing gained between 2% and 5%.

Bitcoin, the largest cryptocurrency of all, rose 0.6% to $3,667.38. As we reported earlier, bitcoin continues to cling to $3,600 but a failure to extend gains beyond $3,750 could set the tone for another downward correction.

Cryptocurrencies as a whole reached a value of $122.4 billion, according to CoinMarketCap. That represents a gain of about $800 million from 24 hours earlier.

In roughly one month’s time, the crypto bear market will become the longest in history, according to CNBC’s Ran NeuNer. Thursday was day 391 of the bearish trend. The previous record, set in 2015, was 420 days. Relevant reading: Longest Bear Market in Crypto History?

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.7 stars on average, based on 740 rated postsSam Bourgi is Chief Editor to Hacked.com, where he leads content development for one of the world's foremost cryptocurrency resources. Over the past eight years Sam has authored more than 10,000 articles and over 40 whitepapers in the fields of labor market economics, emerging technologies, cryptocurrency and traditional finance. Sam's work has been featured in and cited by some of the world's leading newscasts, including Barron's, CBOE and Forbes. Contact: sam@hacked.com Twitter: @hsbourgi




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